⚡What Dog Training Taught Me About Crypto
DeFi learning strategies inside
In January 2023, I rescued a Belgian Malinois dog. These dogs are widely considered some of the most athletic and high energy in the world. They’re the ones you see videos of climbing up walls.
Since then, I’ve spent countless hours learning to train and training my Malinois. High energy, working-line dogs are capable of incredible feats of athleticism and intelligence, but also have a level of drive that can be extremely difficult to channel. Some of the things I’ve taught mine to do:
Sprint around an obstacle in the distance and come back
Jump over obstacles
Crawl through tunnels
Walk between my legs
I’m not going to LARP as an expert dog trainer, but I’ve learned a lot of valuable lessons from this experience. Surprisingly, many of those lessons also apply to crypto.
What?
You read that right.
What does dog training have to do with crypto?
It comes down to 2 things:
Incentives
Everything can be trained like a muscle
Let’s go into more detail.
Incentives
Incentives matter. They sit at the core of dog training and they’re essential to tokenomics in crypto.
In short, you get more of what you reward. Simple in theory; difficult in practice.
When training dogs, a common mistake people make is rewarding undesirable behavior. Imagine this:
A dog is barking at you because it wants a bone.
The noise makes it impossible for you to focus, wearing you down.
Eventually, you cave in and give the dog a bone.
What did you just teach the dog? That if it barks, it gets what it wants. The next time, it will be even more determined to bark as it knows that if it barks for long enough, you’ll give in.
Now consider an alternative course of action:
A dog is barking at you because it wants a bone.
You ignore it. Put in ear plugs, go to another room, whatever it takes.
Eventually the dog calms down. You give it a command to go to its bed and only then give it a toy to occupy itself.
In this scenario, you’re rewarding the dog calming down and waiting patiently on its bed.
Believe it or not, crypto projects are faced with a similar dilemma. Do their tokenomics reward sellers or holders?
Consider DeFi tokenomics. Most of tokenomics boils down to supply and demand
And supply and demand for a token are largely determined by whether the incentives to buy or sell a token are stronger.
Incentives to Buy a Token:
Staking yield
Fee discounts
Utility within DeFi
Incentives to Sell a Token:
Seed investors are up 100X
Inflation is greater than staking yield
Projects that reward holders will see more people hold; projects that reward sellers will see more people sell. Most tokenomics models, even complex ones, adjust these incentives to try to reduce sell pressure and increase buy pressure.
Everything Can be Trained Like a Muscle
As an avid gym-goer, I was already familiar with the concept of progressive overload. Dog training showed me that this same concept can be applied to virtually everything else.
Here’s an example.
When training my Malinois to heel, the progression looked something like this:
Sit next to me on command
Walk next to me in my yard
Walk next to me to the end of the street and back
Walk next to me for 20 minutes
The idea is to start small and progressively get more advanced. The same thing applies to learning crypto. Crypto can be broken down and systematized like any other skill.
If I were starting again, here’s how I would do it:
Break down all of the different skills I needed to learn (on-chain analysis, tokenomics, narratives, portfolio management, etc).
Develop a system for learning each skill from practice, case studies, and peers.
Apply the principle of progressive overload to each skill.
For something like on-chain analysis, a training plan might look like this:
Learn how to read transactions on Etherscan. Practice until comfortable.
Learn to read wallet history and holdings with DeBank.
Learn how to use a variety of tools to find wallets that bought tokens early.
Practice finding wallets that bought tokens early and then tracking their new purchases.
Each progression builds on the knowledge from the previous progression.
Learn Faster with Double Your DeFi
For those of you looking to progress in crypto faster, I have a limited time opportunity.
Starting next week, I’m teaching the Double Your DeFi course with my friend The DeFi Edge. This is an intensive, five-week course designed to systematically teach you everything you need for the bull market.
Double Your DeFi includes:
Live modules with case studies and frameworks systematize your crypto learning
Live research sessions
Office hours
A community to learn together
Bonus pre-recorded content and materials
This course condenses years of learning into one intense month to help students get prepared for the bull market quickly. It is built on several key principles:
Live case studies - Live case studies help to condense years of market lessons into a short time period.
Show don’t tell - This course is highly hands-on, involving live examples, recent case studies, and assignments you can do on your own time to solidify the learnings.
Developing systems - A huge part of Double Your DeFi is about developing systems so that you no longer have to guess. How do you source ideas for new cryptos? How do you analyze cryptos before buying? How do you manage your portfolio and take profits? This course teaches you frameworks to manage all of that.
This is the fourth AND LAST time we’re going to run this course. Space is limited and we are on track to sell out by Friday.
If this sounds like something that might interest you, you can read all of the course details at https://go.doubleyourdefi.com/.
Until next time,
Patrick Scott
Dynamo DeFi